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 |  Subject: Princeton's Paul Krugman, a Liberal, Wins Nobel Economics Prize; Yawn!  Mon Oct 13, 2008 9:36 am | |
| Princeton University professor and New York Times columnist Paul Krugman won the Nobel Prize in economics for his work on trade theory.
Krugman, 55, received the prize ``for his analysis of trade patterns and location of economic activity,'' said the Royal Swedish Academy of Sciences, which selects the winners. His work explained how economies of scale influence trade and urbanization.
``It's a total surprise,'' Krugman said in a telephone interview.
The Nobel laureate gained his reputation in economics by contributing to strategic trade theory, contending that countries could steal a march on other nations by subsidizing strategic industries. He has found broader fame with his newspaper columns that regularly attack President George W. Bush's policies.
A self-proclaimed liberal, Krugman has regularly taken Bush to task in his columns for the New York Times, slamming the president personally for everything from the war in Iraq to his big tax cuts.
``Mr. Bush has degraded our government and undermined the rule of law,'' Krugman wrote in a column on May 18, 2007. ``He has led us into strategic disaster and moral squalor.''
Depression Parallels
In an interview with Bloomberg Television on Oct. 10, Krugman said the current financial turmoil had similarities with the Great Depression. ``The parallels are stronger than I thought they would be,'' he said. ``We developed a financial system that is out of control. The only things people want to buy are T-bills and water.''
The Princeton economist was honored for theories that help explain why world trade is dominated by countries that both import and export similar products, automobiles, for example.
``This kind of trade enables specialization and large-scale production, which result in lower prices and a greater diversity of commodities,'' the Royal Academy said in a statement today.
``Trade theory was stuck in a rut 25 years ago and Krugman was the creative thinker who brought new ideas to it,'' said Tony Venables, a professor at the University of Oxford who wrote a book with Krugman. ``His work had a profound effect on what we know about international economics. Trade economics needed an analytical breakthrough as people were relying on old-fashioned models until he took them on.''
Krugman said today he saw little danger of a move toward protectionism in the U.S., no matter which party wins in next month's elections.
Protectionism
``There may be a standstill, or slowdown at least, on new trade agreements, but I find reversal on trade agreements implausible,'' he said in remarks via telephone to a group of reporters in Stockholm. ``Full-scale protectionism I don't see.''
In 1991, Krugman was awarded the John Bates Clark Medal by the American Economic Association, which is awarded to the best economist under the age of 40.
Krugman was born in Long Island and studied economics at Yale University. He obtained a Ph.D. from the Massachusetts Institute of Technology in 1977 before joining Princeton University. From 1982 to 1983 he served on the White House Council of Economic Advisers, during the presidency of Ronald Reagan. He has published a series of books and his ability to turn complicated economic theory into understandable prose led to him write an opinion column for the New York Times for the past eight years.
Previous Winners
Alfred Nobel, the Swede who invented dynamite, in his will in 1896 established awards for achievements in physics, chemistry, medicine, peace and literature. The economics prize was set up by Sweden's central bank in 1968. Former winners include Milton Friedman, Amartya Sen and Friedrich August von Hayek.
The award's official name is ``The Bank of Sweden Prize in Economic Sciences in Memory of Alfred Nobel.'' The prize consists of 10 million Swedish kronor ($1.41 million), a gold medal and a diploma.
http://www.bloomberg.com/apps/news?pid=20601087&sid=a6hJj1.ALVJE&refer=home |
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